Mississippi Tax Strategy: Magnolia State Tax Freedom
Mississippi has a 5% flat tax—moderate for the region. But federal taxes still claim up to 37%. Section 7702 delivers complete tax freedom.
The Mississippi Tax Picture
Mississippi is 5% flat rate is reasonable, but combined with federal taxes, retirement income still faces significant erosion.
✅ The Good News
- 5% flat tax (being reduced)
- Social Security fully exempt
- All retirement income exempt
- Very low cost of living
⚠️ The Challenge
- Federal taxes still apply (up to 37%)
- 401(k) distributions federally taxed
- Combined rate can exceed 42%
- Limited healthcare infrastructure
Mississippi Tax By The Numbers
Section 7702: Your Tax Freedom Solution
Section 7702 of the IRS tax code creates a powerful opportunity: access your retirement funds through policy loans that are completely tax-free—at both federal and state levels. For Mississippi residents, this means escaping both the state tax burden and federal taxation entirely.
Federal Tax-Free
Policy loans bypass federal income tax entirely. No 22-37% federal tax on your retirement income.
State Tax-Free
No Mississippi state income tax on policy loans. Your retirement income stays tax-free at the state level.
Mississippi Professionals We Typically Serve
Healthcare Professionals
Physicians at UMMC, Baptist, and other Mississippi systems
Manufacturing Executives
Leaders at Nissan, Toyota, and Mississippi manufacturers
Gaming Industry
Casino and hospitality executives on Gulf Coast
Energy Professionals
Oil, gas, and petrochemical executives
Agricultural Leaders
Large-scale farmers and agribusiness executives
Business Owners
Entrepreneurs across Mississippi economy
Mississippi Areas We Serve
Matt Nye's Recommendation
"Mississippi is a hidden gem for retirement. The state exempts ALL retirement income from state tax, and the cost of living is the lowest in America."
"But federal taxes do not care about Mississippi exemptions. They take 22-37% of your 401(k) regardless of what the state does."
"For my Nissan executives, UMMC physicians, and Gulf Coast professionals, Section 7702 completes the picture. You already have zero state tax on retirement. Now eliminate federal taxes and make Mississippi lowest-cost-of-living work even harder for you."
— Matt Nye, 20-Year Industry Veteran
Frequently Asked Questions
Mississippi exempts all retirement income. Why do I need Section 7702?
Mississippi exempts retirement income from STATE tax—excellent! But federal taxes still take 22-37% of every 401(k) dollar. Section 7702 policy loans are federal tax-free too.
Mississippi has the lowest cost of living. Does tax planning matter?
Low cost of living makes every dollar more valuable—which means tax-free dollars are even more powerful. Federal taxes are the same everywhere, so savings are significant.
I work at Nissan Canton. How does Section 7702 help?
Auto manufacturing salaries are substantial, meaning high federal brackets. Section 7702 converts that income into tax-free retirement income. The savings compound over decades.
I am in the Gulf Coast gaming industry. Is Section 7702 relevant?
Casino executive compensation is high but the industry can be cyclical. Section 7702 provides stable, tax-free retirement income regardless of gaming industry cycles.
Mississippi is reducing taxes. Should I wait?
Mississippi state taxes are improving, but federal taxes will not change. Your 401(k) is federally taxed at 22-37% regardless. Section 7702 solves the federal problem now.
Ready for Mississippi Tax Freedom?
Discover how Section 7702 can eliminate both state and federal taxes on your retirement income. Schedule your free analysis today.
Schedule Your Mississippi Tax Analysis →Free 30-minute consultation. No obligation. No sales pressure.